American Hospital Association urges CMS to delay cuts to Medicaid disproportionate share hospital payments

Credit: Matthew Bisanz.

The American Hospital Association is urging the Centers for Medicare and Medicaid Services to delay implementing payment cuts that help providers serve vulnerable populations, such as the poor, disabled and elderly.

CMS plans to begin cutting disproportionate share hospital payments in fiscal 2018.

The Affordable Care Act planned for the reductions because of the belief that the ACA and its provision for Medicaid expansion would insure more people served by the DSH payments.

[Also: Hospitals can expect $2B less in DSH payments for 2018]

But Medicaid expansion was not adopted nationwide. Thirty-one states and the District of Columbia decided to expand the number of people covered under Medicaid.

Also, there was lower-than-anticipated enrollment in coverage through the health insurance marketplaces, the AHA said in an August 23 letter to CMS Administrator Seema Verma.
The AHA said it also had significant concerns with the underlying data used to determine the DSH health reform methodology.

CMS plans to use Medicaid inpatient utilization rate data reported by states, and the Medicaid DSH audit data reported by states for the  rate year 2013.

The key components of the methodology, such as the assessment of how well states target DSH payments, and the determination of the base allotment amount, would be based on data that is not only old and incomplete, but largely unavailable to the public, the AHA said.

CMS has yet to provide technical guidance on the calculations and data sources to be used, none of which are publicly available, the AHA said.

"This lack of transparency significantly hampers state governments' and stakeholders' ability to assess how the DHRM will affect their state DSH allotment, particularly for FY 2018, the first year of the ACA allotment reductions," said Ashley Thompson, AHA senior vice president for public policy analysis and development.

The ACA reduces state Medicaid DSH allotments starting in 2018 through 2025. It was supposed to start earlier, but legislative action delayed implementation.

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com